PEO Partnerships: A Strategic Move for Startup Success
Quick look: Reports show startup businesses have experienced a slight decline in 2024 which means the demand for new benefit plans may have also slowed. However, brokers can look to this as an opportunity to review clients’ current benefit plans and confirm they still align with their business goals. Though benefits aren’t what ultimately prevent companies from being successful, they do make an impact in helping them reach the next level of growth.
The monthly business statistics report issued by the U.S. Census Bureau shows some states experiencing a decline in “business applications with planned wages” in 2024 compared to 2023. States including Georgia, Mississippi, and North Dakota experienced the biggest decreases.
As a result, brokers serving these states may have experienced a similar slowdown simply due to the dwindling number of new companies entering the industry. Meanwhile, states including Delaware, Wyoming, and New Hampshire reported an increase in startup activity, potentially creating new partnership opportunities between brokers and small- and medium-sized businesses (SMBs) when exploring benefit plans.
Even if brokers are not affected by this dip in startups, it’s still a good time to evaluate current benefit plans and partnerships for their SMB clients. A strategic way brokers can encourage business growth is by connecting clients with a professional employer organization (PEO) to save costs, stay competitive, and keep the focus on core operational activities.
Here are some of the prime advantages of working with a PEO, and how such a partnership can fuel the growth and success of startups and the brokers who serve them.
Harnessing the power of a PEO
SMBs face the unique challenge of balancing everyday operations with learning how to scale effectively in order to stay profitable. Startups often have limited manpower and bandwidth to effectively maintain growth, and the smallest misstep can slow down progress.
What’s helpful is finding ways to streamline processes and optimize strategies to work in alignment with business goals. A PEO partner like ExtensisHR helps to simplify HR and incorporate it as part of a company’s overall strategic plan rather than keeping it separate.
A PEO also automatically expands a broker’s offerings, delivering more value to startup and SMB clients and keeping them on the path to success. Through a comprehensive suite of HR services and support, broker startup clients receive:
Better employee benefits
Startup and SMB clients have smaller budgets to work with than large corporations, but it doesn’t mean they can’t have competitive benefits. With a PEO partner, broker clients receive access to enterprise-level employee benefits from top-rated providers, including healthcare, retirement plans, wellness programs, and life insurance. This helps with recruiting and retention by keeping employees satisfied and engaged to enhance productivity.
Fast and simple setup
The time and expertise it takes to navigate the challenges of day-to-day HR responsibilities, as well as recruiting, hiring, and onboarding employees, is easily a full-time effort. With a PEO partner at the helm of these responsibilities, it frees up the administrative burden for business leaders and gives them more time to focus on serving customers and strategizing growth.
Personalized HR services
Rather than attach a one-size-fits-all approach to HR and benefit services, a PEO solution should fit the unique needs of each client. Startups and SMBs are often more greatly affected by sudden industry disruptions and requirements as their work population and profitability grow, which makes it necessary to have a team of HR professionals who are proactive with solutions and agile when adapting to change.
Dedicated customer support
The world of HR is complex and comes with a learning curve. A PEO partner serves as a complement to guide SMB leaders through their challenges and questions. At ExtensisHR, every client receives a dedicated HR team, including an HR Manager, plus the quick, friendly, expert assistance of the Employee Solution Center, which boasts a 95% same-day resolution rate.
Recruiting and retention management
Recruiting the right employees is one of the biggest factors in a startup’s success. ExtensisHR offers full-scale recruiting services to PEO clients, at no extra cost. Though most PEOs add recruiting as an a la carte option, ExtensisHR understands the value of attracting and securing qualified job candidates and includes it as part of an all-encompassing PEO solution.
Maintain compliance and industry standards
Startups and SMBs need to stay protected from penalties and fines for non-compliance. A PEO partner helps to navigate changing regulations on a local, state, and federal level, as well as keep current on trends in the industry. Whether adhering to new small business laws or aligning with competitive salaries and benefits to attract top talent, it makes a difference having an HR partner handle the responsibilities.
Making the connection for clients
Wouldn’t it be nice to offer SMB clients a way to delegate HR administrative tasks to an experienced team of certified HR professionals? Navigating payroll, compliance, and all of the other HR responsibilities can bog down SMB leaders and keep them from excelling to the next level.
By introducing ExtensisHR as a PEO partner, it supports client satisfaction as well as drives new business for brokers. ExtensisHR offers a full suite of HR and benefit services, including HR administration, benefit implementation and management, payroll, compliance, recruiting, and more. This is in addition to a centralized, mobile-friendly HR platform, which makes it easy for SMB leaders to review and complete necessary tasks.
Broker clients also receive a 24-hour quoting process, and streamlined onboarding and implementation so they can get started quickly. Time is of the essence for startup success and the sooner they can implement a PEO solution, the sooner they can focus on other areas of growth management.
Furthermore, ExtensisHR maintains a people-first, tailored approach to align with SMBs at whatever stage they’re in. Broker clients can expect quick, real-person responses to their questions rather than receive impersonal, automated replies. ExtensisHR also maintains a 93% client retention rate due to its unmatched level of support.
For more information about how introducing clients to a PEO solution can benefit you, contact our team today.
